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CONDOMINIUM BOARD STATED BREACH OF CONTRACT CAUSES OF ACTION AGAINST THE FIRM WHICH INSPECTED THE CONDOMINIUMS DURING CONSTRUCTION 2ND DEPT.

The Second Department determined plaintiff, suing on behalf of condominium owners, had stated breach of contract causes of action against the defendant (KEPC) which had inspected the condominiums during construction on behalf of the developer (SDS). The complaint sufficiently alleged plaintiff was a third-party beneficiary of the oral contract between KEPC and SDS and was a successor-in-interest to the contract between KEPC and SDS:

A nonparty to a contract may maintain a cause of action alleging breach of contract only if it is an intended, and not a mere incidental, beneficiary of the contract … . However, “the identity of a third-party beneficiary need not be set forth in the contract or, for that matter, even be known as of the time of its execution” … . A party asserting rights as a third-party beneficiary must allege: (1) the existence of a valid and binding contract between other parties, (2) that the contract was intended for its benefit, and (3) that the benefit to it is sufficiently immediate, rather than incidental, to indicate the assumption by the contracting parties of a duty to compensate it if the benefit is lost … . “In determining third-party beneficiary status, it is permissible for the court to look at the surrounding circumstances as well as the agreement” … .

Here, taking the allegations in the complaint as true and affording the plaintiff every favorable inference, the plaintiff sufficiently pleaded a cause of action against KEPC to recover damages for breach of contract on a third-party beneficiary theory… . Moreover, KEPC failed to come forward with competent documentary evidence that refuted, as a matter of law, the plaintiff’s allegation that it was a third-party beneficiary of its contract with SDS … .

Condominium unit owners may also be considered successors-in-interest to the condominium sponsor’s construction contracts under certain circumstances … . Whether a party is a successor-in-interest to the performance of a particular contract is generally a question of fact that depends on the circumstances of the case … . Board of Mgrs. of 100 Congress Condominium v SDS Congress, LLC, 2017 NY Slip Op 05414, 2nd Dept 7-5-17

 

CONTRACT LAW (CONDOMINIUM BOARD STATED BREACH OF CONTRACT CAUSES OF ACTION AGAINST THE FIRM WHICH INSPECTED THE CONDOMINIUMS DURING CONSTRUCTION 2ND DEPT)/THIRD-PARTY BENEFICIARY (CONTRACT LAW, CONDOMINIUM BOARD STATED BREACH OF CONTRACT CAUSES OF ACTION AGAINST THE FIRM WHICH INSPECTED THE CONDOMINIUMS DURING CONSTRUCTION 2ND DEPT)/SUCCESSOR-IN-INTEREST (CONTRACT LAW, CONDOMINIUM BOARD STATED BREACH OF CONTRACT CAUSES OF ACTION AGAINST THE FIRM WHICH INSPECTED THE CONDOMINIUMS DURING CONSTRUCTION 2ND DEPT)/CONDOMINIUMS (CONTRACT LAW, CONDOMINIUM BOARD STATED BREACH OF CONTRACT CAUSES OF ACTION AGAINST THE FIRM WHICH INSPECTED THE CONDOMINIUMS DURING CONSTRUCTION 2ND DEPT)

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